EPF & KWSP withdrawal

One way to reduce the amount of interest charged on your housing loan is to reduce your principal amount as quickly as you can. This also helps you to settle your loan faster, or if you choose to, reduce your monthly payment.

The choice is yours: reduce your repayment period and save on interest payment; or reduce your monthly payment and have a bit more to spend every month. You can also work out with the bank to have a bit of both. Of course this is subject to any conditions imposed on the loan. Some corporate loans (loans obtained through your employer), for example, do not allow borrows to change the monthly payment amount.

Regardless of your preferences, EPF allows members to withdraw part of their savings for this purpose. This is either to reduce the member’s own housing loan or that of his/her spouse’s.

Withdrawal for reducing a housing loan is applicable once a year, one year after the original withdrawal (for buying or building a house) was made. The subsequent withdrawals are only applicable to the same loan.

Should you refinance the house, withdrawal to reduce housing loan is only applicable to the original balance of the original loan.  

Withdrawal to Reduce / Redeem Housing Loan

This withdrawal allows you to withdraw your Account II savings to reduce or redeem the balance of your housing loan taken from a financial institution approved by the EPF for the purchase or construction of a house based on the followings conditions: Individual purchase; or Joint purchase with spouse, family members or other individuals; or Assisting spouse to reduce or redeem balance of housing loan. Withdrawal Eligibility You are eligible to apply if you are: A Malaysian citizen; or A Permanent Resident; or A Malaysian citizen who have withdrawn your savings under Leaving The Country Withdrawal before 1 August 1995 but subsequently returned and re-contribute to EPF; or A Non-Malaysian citizen (Expatriate) who became a member of the EPF before 1 August 1998. You need to have savings in your Account II and you must also have not reached 55 years of age on the date the application is received by the EPF. Conditions of Withdrawal The conditions of withdrawal to reduce / redeem balance of housing loan are as follows: The type of house purchase or built are: Bungalow; Terrace; Semi-Detached; Flat; Condominium; Apartment; Studio Apartment; Service Apartment; Town House. Shop house with a dwelling unit. Loan Purpose Purpose of loan is to finance the purchase or construction of the house. Mortgage Status The property must be charged as collateral for the housing loan. Property Ownership You must be registered as the owner of the said property except for withdrawal to assist spouse in reducing / redeeming housing loan. Housing Loan Balance You must still have an existing housing loan outstanding balance. Source of Loan The housing loan must only be taken from the approved sources a follows: Financial Institutions duly licensed under the Bank & Financial Institution Act 1989 (BAFIA); or Federal/ State Government or other government financial agencies; or Member’s employer; or Licensed co-operative society/ company (approved by the Development & Co-operative Department, Ministry of Entrepreneur Development & Co-operative); or Licensed insurance company approved by Bank Negara. Refinancing Balance of loan considered is the outstanding balance approved by the first financial institution. This withdrawal is subject to the following conditions:  Have Made Withdrawal Previously Have Not Made Withdrawal Before Individual Withdrawal / Joint Withdrawal to Assist Spouse Withdrawal is allowed only for the same housemade under the previous withdrawal Withdrawal is allowed for a different house  Withdrawal is allowed forany of your houses Additional Conditions for Withdrawal to Assist Spouse to Reduce Loan Balance You do not have to take the housing loan or have to be registered as a co-owner. Your spouse need to purchase or build the house and take a housing loan to finance the purchase or construction of the house. However, you are not eligible to withdraw for the purpose of: Renovating, repairing or make extension works to an existing house and for personal use; or Overdraft loan; or Loan taken from individuals. Amount Eligible to Withdraw Minimum amount of withdrawal is not less than RM500 and the maximum amount of withdrawal is subject to the balance of savings in Account II or the balance of housing loan, whichever is lower: TYPE OF WITHDRAWAL Individual/Assisting Spouse Joint Withdrawal with Spouse / Family Members / Other Individuals             Total balance of housing loan;             OR             All savings in Account II subject to the             minimum withdrawal amount of not less             than RM500 and total balance of             housing loan.           Total balance of housing loan;           OR           All savings in Account II of all applicants           subject to the minimum withdrawal amount           of not less than RM500 and total balance           of housing loan. You can choose to determine the amount you wish to withdraw from your savings in Account II, subject to the maximum amount you are entitled to withdrawal by completing "Surat Akujanji Pilihan Amaun Pengeluaran". Frequency of Withdrawal Withdrawal application can be made once a year from the date of last housing withdrawal. You must also have minimum RM500 balance in your Account II.

How To Apply

Application can be submitted via submission at counter or by post. Submission at Counter You need to produce: Completed KWSP 9C (AHL) form (Download here)  Supporting documents (original and photocopy) Identification Card / Military Identification Card /MyKad OR Police Identification Card affixed with your right and left thumbprint impressions on its copy and Certifying Letter from your employer confirming that your police number and Identification Card number refer to the same person; Letter from the financial institution confirming the latest outstanding balance of housing loan according to the pre-set format; Sales and Purchase Agreement / Construction of House Agreement * (Only for the first time application and refinance withdrawal application); Housing Loan Approval Letter (in your name for individual / joint withdrawal or in spouse’s name for withdrawal to assist spouse) *; Deed of Title (11A/B) in your name (individual / joint withdrawal) or in your spouse’s name (assisting spouse withdrawal) and Mortgage Form 16A (including Annexure) *; OR Deed of Assignment and the security documents as mentioned in the Loan Approval Letter, if any *. (This document is exempted for loans obtained from the Treasury Malaysia and can be replaced by Loan Balance Statement from the Housing Loan Division, Treasury Malaysia)  (*) Photocopy of these documents must be certified by the financial institution if the original documents are in their possession. Additional Documents For Assisting Spouse Withdrawal / Joint Withdrawal: Proof of husband and wife relationship such as Marriage Certificate or Children’s Birth Certificate For Refinancing Withdrawal: Sales and Purchase Agreement / Construction of House Agreement; All Housing Loan Redemption Letters; and All Housing Loan Approval Letters. For Reducing / Redeeming Housing Loan of Second House Withdrawal: One of the following documents as proof of sale / release of ownership of first house: Transfer of ownership document Form KTN 14A in the name of the purchaser, duly completed by the Land Office; or Deed of Assignment between you and the purchaser; or Deed of Title in the name of the purchaser and Sales and Purchase Agreement between you and the purchaser; or Real Property Gains Tax Form (CKHT 5) and Sales and Purchase Agreement between you and the purchaser; or Public Auction Form (KTN 16F or KTN 16I) and confirmation from the bank; or Transfer of property ownership through a Court Order to any party and Divorce Papers (for divorced cases); or Official Search from the Land Office showing your name and the new owner and Sales and Purchase Agreement between you and the purchaser. Submission by Post You are required to produce the completed KWSP 9C (AHL) Withdrawal Form along with photocopies of the said documents mentioned above certified by certifying officers authorized by the EPF. Applications can be sent to: The Employees Provident Fund Locked Bag No. 220, Jalan Sultan, 46720 Petaling Jaya, Selangor, Malaysia.